SCHWEITZER-MAUDUIT INTERNATIONAL, INC. (NYSE:SWM) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02
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Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Appointment of New Chief Executive Officer
On March 30, 2017, Schweitzer-Mauduit International, Inc. (the
Company) announced that it has named Jeffrey Kramer, PhD, as
Chief Executive Officer of the Company, effective as of April 21,
2017 or another mutually agreeable date (the Start Date). From
the Start Date through May 5, 2017 (the Transition Date), Dr.
Kramer and Mr. Frdric Villoutreix, the current Chairman and Chief
Executive Officer of the Company, will serve as Co-Chief
Executive Officers of the Company. Dr. Kramer will also be
appointed to serve as a member of the Companys Board of Directors
(the Board) effective as of the Start Date. Commencing on the
Transition Date, Dr. Kramer will transition from Co-Chief
Executive Officer of the Company to sole Chief Executive Officer
of the Company. Dr. Kramer, 57, has served as Vice President,
Lubricants of Brenntag AG, a distributor of chemicals, since
January 2016. From January 2013 through December 2015, Dr. Kramer
served as President and Chief Executive Officer of J.A.M.
Distributing Company, a distributor of high performance
lubricants and fuels. Dr. Kramer previously held various senior
positions at Air Products and Chemicals, Inc., an industrial
gases company, including Vice President and Chief Technology
Officer from June 2012 through December 2012 and Vice President
and General Manager, Packaged Gases, from 2005 through June 2012.
Company) announced that it has named Jeffrey Kramer, PhD, as
Chief Executive Officer of the Company, effective as of April 21,
2017 or another mutually agreeable date (the Start Date). From
the Start Date through May 5, 2017 (the Transition Date), Dr.
Kramer and Mr. Frdric Villoutreix, the current Chairman and Chief
Executive Officer of the Company, will serve as Co-Chief
Executive Officers of the Company. Dr. Kramer will also be
appointed to serve as a member of the Companys Board of Directors
(the Board) effective as of the Start Date. Commencing on the
Transition Date, Dr. Kramer will transition from Co-Chief
Executive Officer of the Company to sole Chief Executive Officer
of the Company. Dr. Kramer, 57, has served as Vice President,
Lubricants of Brenntag AG, a distributor of chemicals, since
January 2016. From January 2013 through December 2015, Dr. Kramer
served as President and Chief Executive Officer of J.A.M.
Distributing Company, a distributor of high performance
lubricants and fuels. Dr. Kramer previously held various senior
positions at Air Products and Chemicals, Inc., an industrial
gases company, including Vice President and Chief Technology
Officer from June 2012 through December 2012 and Vice President
and General Manager, Packaged Gases, from 2005 through June 2012.
In connection with his appointment as Chief Executive Officer,
Dr. Kramer and the Company agreed to an offer letter concerning
his employment (the Offer Letter), dated March 28, 2017. to the
Offer Letter, Dr. Kramer will receive an annual base salary of
$650,000, with a sign-on bonus of $290,000, subject to certain
contingencies, which Dr. Kramer will be required to repay on a
pro-rata basis from the Start Date should he voluntarily
terminate his employment with the Company or should he be
terminated by the Company for cause, in either case, prior to the
four-year anniversary of the Start Date. Within thirty (30) days
of the Start Date, Dr. Kramer will receive a grant of 4,500
shares of restricted stock, 2,250 of which will vest on the
one-year anniversary of the Start Date and 2,250 of which will
vest on the four-year anniversary of the Start Date, subject to
his continued employment with the Company through the applicable
vesting date. The shares will immediately vest if Dr. Kramers
employment with the Company ends for any reason other than a
voluntary resignation with good reason or termination for cause.
Dr. Kramer and the Company agreed to an offer letter concerning
his employment (the Offer Letter), dated March 28, 2017. to the
Offer Letter, Dr. Kramer will receive an annual base salary of
$650,000, with a sign-on bonus of $290,000, subject to certain
contingencies, which Dr. Kramer will be required to repay on a
pro-rata basis from the Start Date should he voluntarily
terminate his employment with the Company or should he be
terminated by the Company for cause, in either case, prior to the
four-year anniversary of the Start Date. Within thirty (30) days
of the Start Date, Dr. Kramer will receive a grant of 4,500
shares of restricted stock, 2,250 of which will vest on the
one-year anniversary of the Start Date and 2,250 of which will
vest on the four-year anniversary of the Start Date, subject to
his continued employment with the Company through the applicable
vesting date. The shares will immediately vest if Dr. Kramers
employment with the Company ends for any reason other than a
voluntary resignation with good reason or termination for cause.
Effective as of the Start Date, Dr. Kramer will be eligible to
participate in the Companys Annual Incentive Plan (AIP) as well
as the Companys 2015 Long-Term Incentive Plan (LTIP). His 2017
AIP payout opportunity will be equal to 50% of his base salary at
the target level of performance, with a maximum payout
opportunity equal to 200% of his base salary, prorated for 2017
based on the Start Date. His 2017 LTIP opportunity will be equal
to 200% of his base salary at the target level of performance,
with a maximum payout opportunity equal to 400% of his base
salary, prorated based on the Start Date. Additionally, if Dr.
Kramer experiences a qualifying termination of employment
following a change in control, he will be eligible for benefits
continuation and severance pay in an amount equal to three times
his highest annual compensation (defined as base salary and AIP
paid or payable for a calendar year) for any calendar year
beginning with or within the three-year period terminating on the
date of termination of his employment. For a qualifying
termination of employment prior to a change in control, Dr.
Kramer will be entitled to receive twenty-four (24) months of
base salary and benefits continuation. Dr. Kramer will also
receive relocation benefits in accordance with Company policy,
subject to certain enhancements specified in the Offer Letter.
participate in the Companys Annual Incentive Plan (AIP) as well
as the Companys 2015 Long-Term Incentive Plan (LTIP). His 2017
AIP payout opportunity will be equal to 50% of his base salary at
the target level of performance, with a maximum payout
opportunity equal to 200% of his base salary, prorated for 2017
based on the Start Date. His 2017 LTIP opportunity will be equal
to 200% of his base salary at the target level of performance,
with a maximum payout opportunity equal to 400% of his base
salary, prorated based on the Start Date. Additionally, if Dr.
Kramer experiences a qualifying termination of employment
following a change in control, he will be eligible for benefits
continuation and severance pay in an amount equal to three times
his highest annual compensation (defined as base salary and AIP
paid or payable for a calendar year) for any calendar year
beginning with or within the three-year period terminating on the
date of termination of his employment. For a qualifying
termination of employment prior to a change in control, Dr.
Kramer will be entitled to receive twenty-four (24) months of
base salary and benefits continuation. Dr. Kramer will also
receive relocation benefits in accordance with Company policy,
subject to certain enhancements specified in the Offer Letter.
The foregoing summary of the Offer Letter does not purport to be
complete and is qualified in its entirety by the full text of the
Offer Letter itself, a copy of which is filed as Exhibit 10.1
hereto and is incorporated herein by reference.
complete and is qualified in its entirety by the full text of the
Offer Letter itself, a copy of which is filed as Exhibit 10.1
hereto and is incorporated herein by reference.
Transition of Frdric Villoutreix
On March 30, 2017, the Company also announced that Frdric
Villoutreix will depart from his position as Chief Executive
Officer. In connection with his departure, the Company and Mr.
Villoutreix entered into a Letter of Agreement (the Letter of
Agreement), governing Mr. Villoutreixs transition from his role
as Chief Executive Officer, and a Consulting Agreement (the
Consulting Agreement), governing Mr. Villoutreixs ongoing
consulting services following the Transition Date, each entered
into on March 28, 2017. to the Letter of Agreement, from the
Start Date through the Transition Date, Mr. Villoutreix will
serve as Co-Chief Executive Officer with Dr. Kramer and will
remain a member of the Board. On the Transition Date, Mr.
Villoutreix will resign from his positions as Co-Chief Executive
Officer and a member of the Board and, from the Transition Date
through February 28, 2018 or such other date on which he ceases
providing services to the Company (the Separation Date), Mr.
Villoutreix will serve as an independent contractor consultant to
the Company to the Consulting Agreement. In the Consulting
Agreement, Mr. Villoutreix has agreed to perform certain
consulting services to facilitate the management transition,
maintain ongoing external relationships on behalf of the Company,
and provide such other similar services as requested by Dr.
Kramer.
Villoutreix will depart from his position as Chief Executive
Officer. In connection with his departure, the Company and Mr.
Villoutreix entered into a Letter of Agreement (the Letter of
Agreement), governing Mr. Villoutreixs transition from his role
as Chief Executive Officer, and a Consulting Agreement (the
Consulting Agreement), governing Mr. Villoutreixs ongoing
consulting services following the Transition Date, each entered
into on March 28, 2017. to the Letter of Agreement, from the
Start Date through the Transition Date, Mr. Villoutreix will
serve as Co-Chief Executive Officer with Dr. Kramer and will
remain a member of the Board. On the Transition Date, Mr.
Villoutreix will resign from his positions as Co-Chief Executive
Officer and a member of the Board and, from the Transition Date
through February 28, 2018 or such other date on which he ceases
providing services to the Company (the Separation Date), Mr.
Villoutreix will serve as an independent contractor consultant to
the Company to the Consulting Agreement. In the Consulting
Agreement, Mr. Villoutreix has agreed to perform certain
consulting services to facilitate the management transition,
maintain ongoing external relationships on behalf of the Company,
and provide such other similar services as requested by Dr.
Kramer.
Under the Letter of Agreement, Mr. Villoutreix has agreed to
comply with certain non-competition and non-solicitation
obligations and other restrictive covenants during the time he is
performing services for or on behalf of the Company to the Letter
of Agreement or the Consulting Agreement. In addition, Mr.
Villoutreix has agreed to certain ongoing cooperation obligations
comply with certain non-competition and non-solicitation
obligations and other restrictive covenants during the time he is
performing services for or on behalf of the Company to the Letter
of Agreement or the Consulting Agreement. In addition, Mr.
Villoutreix has agreed to certain ongoing cooperation obligations
and to provide certain releases and waivers as contained in the
Letter of Agreement. As consideration under the Letter of
Agreement and Consulting Agreement, the Company has agreed to
provide Mr. Villoutreix compensation and benefits as follows: (i)
through the Transition Date, an annualized base salary at the
rate in effect for him as of the date of the Letter of Agreement;
(ii) from the Transition Date through the Separation Date,
$27,703 a month, to the Consulting Agreement; (iii) continuing
eligibility for vesting of certain currently outstanding
restricted shares through the Separation Date; (iv) a lump sum
gross payment of $850,000, in consideration for the restrictive
covenants contained in the Letter of Agreement; (v) a lump sum
payment of an amount equal to the amount of the matching
contributions that Mr. Villoutreix would have received under the
Schweitzer-Mauduit International, Inc. Retirement Savings Plan
for both pre- and post- tax contributions from the Transition
Date through the Separation Date, subject to certain assumptions;
and (vi) an additional sum equal in value to a pro rata portion
of the AIP and annual equity awards under the LTIP, based on the
period of time between January 1, 2017 and the Transition Date.
Letter of Agreement. As consideration under the Letter of
Agreement and Consulting Agreement, the Company has agreed to
provide Mr. Villoutreix compensation and benefits as follows: (i)
through the Transition Date, an annualized base salary at the
rate in effect for him as of the date of the Letter of Agreement;
(ii) from the Transition Date through the Separation Date,
$27,703 a month, to the Consulting Agreement; (iii) continuing
eligibility for vesting of certain currently outstanding
restricted shares through the Separation Date; (iv) a lump sum
gross payment of $850,000, in consideration for the restrictive
covenants contained in the Letter of Agreement; (v) a lump sum
payment of an amount equal to the amount of the matching
contributions that Mr. Villoutreix would have received under the
Schweitzer-Mauduit International, Inc. Retirement Savings Plan
for both pre- and post- tax contributions from the Transition
Date through the Separation Date, subject to certain assumptions;
and (vi) an additional sum equal in value to a pro rata portion
of the AIP and annual equity awards under the LTIP, based on the
period of time between January 1, 2017 and the Transition Date.
The foregoing summaries of the Letter of Agreement and the
Consulting Agreement do not purport to be complete and are each
qualified in their entirety by the full text of the Letter of
Agreement and the Consulting Agreement, copies of which are filed
hereto as Exhibit 10.2 and Exhibit 10.3, respectively, and which
are incorporated herein by reference.
Consulting Agreement do not purport to be complete and are each
qualified in their entirety by the full text of the Letter of
Agreement and the Consulting Agreement, copies of which are filed
hereto as Exhibit 10.2 and Exhibit 10.3, respectively, and which
are incorporated herein by reference.
The Company issued a press release announcing the foregoing
events, which is attached hereto as Exhibit 99.1.
events, which is attached hereto as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
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10.1
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Offer Letter, dated March 28, 2017, between
Schweitzer-Mauduit International, Inc. and Jeffrey Kramer. |
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10.2
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Letter of Agreement, dated March 28, 2017, between
Schweitzer-Mauduit International, Inc. and Frdric Villoutreix. |
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10.3
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Consulting Agreement, dated March 28, 2017, between
Schweitzer-Mauduit International, Inc. and Frdric Villoutreix. |
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10.3.1
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Non-disclosure Agreement (Exhibit A to the Consulting
Agreement, dated March 28, 2017, between Schweitzer-Mauduit International, Inc. and Frederic Villoutreix). |
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99.1
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Press release dated March 30, 2017.
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About SCHWEITZER-MAUDUIT INTERNATIONAL, INC. (NYSE:SWM)
Schweitzer-Mauduit International, Inc. is a producer of specialty papers and resin-based products. The Company manufactures and sells lightweight specialty papers, which are used in manufacturing ventilated cigarettes, reconstituted tobacco used in producing blended cigarettes and banded papers used in the production of lower ignition propensity (LIP) cigarettes. The Company operates through two segments: Engineered Papers, and Advanced Materials and Structures. Its Engineered Papers segment produces both tobacco-related papers and non-tobacco-related papers. The Company’s tobacco-related papers include various porous papers used to wrap parts of a cigarette, such as tobacco column and filter, and reconstituted tobacco leaf (RTL), which is blended with virgin tobacco in a cigarette. It manufactures and sells a range of engineered resin-based, rolled goods, such as films, nets, foams and other non-wovens. The Company operates approximately 20 production locations. SCHWEITZER-MAUDUIT INTERNATIONAL, INC. (NYSE:SWM) Recent Trading Information
SCHWEITZER-MAUDUIT INTERNATIONAL, INC. (NYSE:SWM) closed its last trading session 00.00 at 41.30 with 121,096 shares trading hands.